Prepare to Deliver: What Smart Owners Do During Slow Times

0:00All right. Happy Thursday morning. I got my coffee here this time because usually we do it in the afternoon. But today it's been a rough couple of weeks, this whole freaking moving and getting everything and then trying to keep up with everything. It's been a little bit of a bitch, you know what I mean? Yeah. Doing these podcasts. But a couple of things I want to touch on before we get into today's topic.

0:19Today's topic, we're going to talk about when we're slow, what do most small businesses do to fuck themselves? 100%. We actually had somebody say it to us this week. When they get, when they get slow, they cut marketing. But I want to talk about to the collision world out there first. We'll put some of these clips. Yeah, definitely. First of all, we had Progressive and us went round and round this week.

0:45So basically they wrote an estimate on a motorhome which is an absolute piece of shit garbage estimate, and they put basically guessed at prices and put price holders for doors and stuff that it needed, some compartment doors and stuff like that. When we got down to the nitty-gritty, we had like a $2,500 difference in our bill and their bill. Well, we call the customer now and go, our bill is this, you got paid this, you're responsible for X.

1:14Meaning, so I have to say this slow so people don't fucking start running their mouth, if the insurance company pays $3,000, to the guy to repair it. Our estimate is $5,000. Either the insurance company pays the other $2,000 or the customer. It doesn't matter. Our estimate is $5,000. I don't give a shit what the insurance company writes. Well, and Jim just used a great analogy.

1:33It's like going to a doctor or going to the hospital. Your insurance covers whatever portion they decide to choose to cover, and then you're responsible for the rest. Yeah, customer responsibility, what they call it now. How would you like to pay? They now— they collect it upfront with these people before surgeries even. Oh, I bet. Yeah, because they're sick of getting screwed.

1:49Yeah. So yeah, you talk about not getting paid, how much hospital bills, right? Yeah, exactly. And they're so bad that like even on credit reports when you're buying a house and stuff like that, if you have a past due hospital bill, they don't get too butthurt about it. That's kind of crazy. So basically we call the customer and say, hey, our estimate— we'll just use round numbers— our estimate was $5,000.

2:11They, they gave you a check for how much? They gave us $3,000. I said, so you're responsible for $2,000. The guy started talking, I explained to him, he said, "Okay, I agree." Have the phone call recorded, have him approve it online, so we're good to go. Get all done with the job, State Farm, or the customer calls and he says, we say, "You're all set, you owe X amount of dollars."

2:37"Well, no, the insurance company said I guarantee you I won't have to pay anything." So he called Progressive and said, hey, and they said, don't worry, don't worry about that money. The shop's not going to make you pay it. We literally called the guy and explained it to him and have the phone call, have him approve it. So guess what? The insurance adjuster calls like, come on, man, you can't do this.

3:03You can't. I need your receipts. We're not giving you our fucking receipts. Our receipts are irrelevant. Okay. Our markup is our markup. What's your markup? None of your business. Okay, so we went round and round with them. Uh, he's like, can't you do it this time for us? We have a great relationship. We've done 3 jobs for you. We don't have a great relationship.

3:20When we have 100, we'll talk. So basically he's got himself in a pickle because we had the stage set for the customer saying, hey, okay, I understand it's going to get paid. In the meantime, just back up a little bit. The customer called an RV dealer around here and said, when can I have this done? They said, we won't have it done until October.

3:37Well, the guy wants to go camping, so that was one of the things that led into us— him fixing it. The motorhome got done in a couple weeks. It would have been October there. So you had to look at it as like, okay, I want to go camping this season. And that happens a lot. So we've had 3 of these in the last month and a half, 2 months.

3:54This is the last one. And, you know, the insurance guy opened his fucking mouth and said, don't worry, I'll call the shop, you will not have to pay it— pay a dime. Well, he short-circuited that because the guy has a deductible too. Oh man. So stay tuned because the guy hung up on us. The insurance company guy said, I'll call back, and he hasn't.

4:17Well, man, wow. That's what we're talking about as far as the communication. You did this, like you said, you just did the stage all set. The customer is all ready to— this guy wanted to come along and be a hero and be like, oh no, don't worry about it. And he shot himself in the foot and made this a problem when everything was all agreed upon.

4:34100%. And the problem is when these insurance jumpers come to these, most of these insurance adjusters come to the collision shops, the estimators are blowing them because they're thinking the guy's going to write a little bit harder for them because he's being so nice. So that insurance adjuster has a set of numbers, plain and simple. Okay. He's going to hit. He doesn't give a fuck about you.

4:55Yeah. Right.. And I had to switch. Now I had a review with my insurance guy. He said they're having so many problems with these third-party adjusters because these guys want all the insurance work. So what they do is they write, look how much money I saved you, look how much money I saved you. So they get more. So they're screwing shops to get, you know, to write the estimates less so they can get more money or more jobs from these more assignments they call them from these insurance companies.

5:24So they're doing that now because we had one which is a van out there. I don't know if I talked about this yet. It was 101 days storage. I talked about— actually, I touched on it last week, 101 days of storage. Once we got in a big argument that they owed that, we broke it all down. There's a 51-day delay from the adjusters, third-party adjusters doing their job to getting us the check.

5:4551 days. Then we had a 21-day or 22-day— I remember what I said, it's been a minute— that we gave them back. But then now, guess what? We told them, I said, we're gonna lock this down here and we're gonna give you 7 days to get this outta here. Guess what? Today's number 8. We called them 2 days ago and said, hey, we haven't heard from you.

6:02So we gave you a 7-day grace period. Then their storage is starting again. Guess what happened, Jason? Today's number 8 is $100. They're not fucking, they haven't responded. Unbelievable. So they're bitching about that. Now 7 days, here comes the delay again. It went 7 days without them giving, saying, okay, we'll get the van outta here. So now the story starts again. And the thing is, is like, if you're— people aren't listening, you're communicating and documenting the whole entire way.

6:27Absolutely. Emails, phone calls are recorded, phone calls are put in the file, everything. So when that guy with the motorhome says, oh, you never told me about the $2,000, I have the recorded phone call and I also have the repair order that he approved digitally. And I have him, me explaining to him the phone call. So we have all the phone calls and all the documentation.

6:45And that's how we got around with this guy. Like, you have 51 days. We had all the timeline. You have to keep timeline notes. Are imperative dealing with the insurance company. You have to keep your phone calls and have to keep everything locked down. That way you can say, here, these are facts. Wasn't going to take all the emotion out of it.

7:00Here's the timeline. Here's what you didn't do. Here's what you did. Here's what we didn't do. Here's what we did. Here it is, Mr. Insurance Company. I don't know what to fucking tell you. Because if you go to court, you have it all laid out. How can somebody argue with you when the judge looks at it and goes, well, it was 51 days from the time you started this process till you got these people the check and the approval.

7:1951 days. And then you total the vehicle. And they expect us— like the guy said to us, uh, well, I think, you know, reasonable would be like 8 or 9 days storage. We laughed. He's supposed to eat her 9 days, like, for 51 days, that's reasonable. Yeah. So the man was on a property for 101 days. I know that. So now it's actually 100— what, 108 days?

7:41Yeah. And it just keeps going. So they're going to use all the money up that they have already here. So they had a credit coming back to them. They're going to use that up now. But it's our fault that they're not moving their ass. Okay. This real estate here in Brighton, Michigan, what, $17,000, $18,000 a year in property taxes alone? Yeah. Yeah.

8:00Okay. This shit costs money. So your shit sitting on our property and us moving it around, dealing with it, your truck that you totaled, you get, you collect on your end from your insurance. You're insured. So anyway, I figured this would be kind of a good way to start this one off. That's good. It's crazy. It's insane to me how they try to pinch you and they act like they want you to send them your prices so they can give you an assigned margin.

8:25That's insane. Yeah, they just want to pick your margin. 'Cause we all know every business everywhere in the world has all the same fricking markup, right? We all have the same overhead. Absolutely. That's the insurance company. This is the industry standard. Who set the industry standard? The fucking insurance companies by screwing people. So anyway, enough of the collision shit. It's so depressing, right?

8:46We had to get the energy up. Let's get the emotions going, right? So one thing I've been seeing a lot on, um, social media, uh, Mr. Master Tech talked about it, several other people talked about it. Work has kind of hit the brakes, okay? Everything kind of got slow. People say it's a, you know, it's the fuel costs, it's this, it's that.

9:06We got a little bit slow in April. May was okay. June seems to be shaping up pretty decent. But hear me now, guys, for years and years and years, we've had trends where we kind of know that, like, for instance, everybody's getting out of school. Okay, let's start here. November. What happens in November? We have deer hunting in Michigan. That's a big thing, right?

9:27Yeah. So I kind of know right around, you know, the 10th or 11th of November, or maybe even a little bit earlier now, people tend to take off work. They're going deer hunting. They're going, depending on what day of the week it falls on, right? They take that time off. Then deer hunting leads into everybody starts to get thinking about Thanksgiving. So November usually ends up being a slower month towards the end of November, right?

9:52So we know that that was one of the months. Then we go October, or I'm sorry, December, here we come again. We got Christmas. You gotta remember, we have 2 weeks at the after Christmas, between Christmas and New Year's, depending on how it falls, of work days. It's slow there. So you're kind of figuring halfway through November, you kind of get slow and then you kind of don't really pick up till after probably the 6th or the 7th of the next year.

10:17Yeah. Yep. Okay. Yeah. Because people take that whole week off, uh, New Year's. Yeah. So a lot of times it's 2 weeks if you think about it. Yeah. So they take Christmas depending on what day it falls off, what it falls on a Monday, Tuesday. So it could be a 2-week block. So you kind of got to be ready for this. So the average, they're saying, the Small Business Association says you should have in the bank is 3 to 6 months of hard costs, your rent, payroll, you know, utilities, stuff like that.

10:42So if something happens, you could go 3 to 6 months and run your business and not go out. Where does the problem come in? The problem comes in with these small business operators. And I'll say this for the millionth fucking time, they don't know their numbers. They don't know their margins. Did you notice online everybody talks about gross? Yeah, well, my gross profit is this, my gross profit.

11:00That's great. Once again, I'm going to say this. You're talking about what you're doing on the front end. Yep. But let's talk about the back end when that gross profit is getting eaten up by your overhead. Like these guys are like, we're doing good. I don't think my guys are producing more. I need to hire another office staff. I need to hire another service advisor, which is a direct overhead cost.

11:19Right. So all of a sudden that overhead goes up and the margins go down. So as they're going, they're going, they're going, guess what's happening? Gets slow. They're not— they weren't making any money or making a little bit of money when they should be making a decent amount because they know their numbers to sustain and put money in their savings account. They can't put that 10% I talk about a week of your gross into your savings account, right?

11:43And how it builds up. So what ends up happening, these guys have no money, so they could last maybe a couple weeks and holy, holy shit, here we got a big problem going on, right? They don't have lines of credit. So what do they do? They go take a loan from the bank. So they get a loan from the bank, which takes— depending on what kind of loan, I mean, they can get these Nicky-Fooky loans where it's a stupid interest rate and then get it right away.

12:05And now they got money and now they just keep going on and, you know, okay, we don't have to worry about— we borrow money, but that payment comes and now you're not making any money. So you really couldn't afford that payment for that loan. So here things pick up again, you're busy, you forget about it. Yeah, yeah, yeah. But you're still not making the money you should make, so you can't pay that loan back.

12:22So it's just a thing, a downward spiral of your business. Well, so one thing I heard years ago, and I looked it up again this morning, what is the number one thing small business cuts when things get slow? Let me help you people. It's marketing. That's fucking insane. These people literally cut their marketing. Okay. Mike Lee told us a long time ago, he's like, listen, When things get slow and you can't get new customers, that's okay.

12:51Just take your competition's customers. So how do I take my competition's customers? I keep my marketing going because a lot of guys, marketing cost is a big cost. So what do they do when things get slow? They shut their marketing down to save that money. That's the very thing that's going to get your name out there to get you more money. But they cancel, they cut it down.

13:11And we had a client say that to you this week, didn't he? Tell the story. Yeah, no, we were talking about, um, things are going really well for him. His lot is full. And he was like, and you know, he was like, I said, well, this is the time to keep marketing and continuing to figure out what we have going. We've been testing some things and working with this content.

13:29And I'm like, now is the time to really get that, like hit it because you don't want to be messing with marketing when it's slow or be desperate or like, oh my God, I need this business to come in and trying to figure out what, you know, the strategy for your marketing. And he has said like, yeah, you know, usually when it gets slow, the first thing I pull is marketing.

13:47And it's like, to your point, it's like jumping out of an airplane and cutting your parachute off. Yeah. And, you know, I can understand when you're so busy, like I said before, when you're so busy and you're a month out, yes, you don't keep going full bore on your marketing. You can cut it back a little bit, but you got to be out there.

14:03Yep. You know, they used to say 10%, you know, when you're trying to grow, keep it at 3 or 4% to maintain. These guys just cut their marketing off. Then all of a sudden they're poof, they're gone. Okay. Then another thing with these guys are not realizing is it takes 30 days, 40 days to get it integrated into the search engines. Number one.

14:22Number two, when times are slow and everybody cuts their marketing, what does it do to the keyword spend? The auction prices of the keywords go down. So if you keep going strong, it statistically, it shows that people that keep marketing actually grow and gain traction on Google because they didn't cut it off. So think about a keyword you might spend $8 on, all of a sudden you're spending $4 on.

14:46So now you could get double the bang for your money. So by everybody retracting their marketing dollars, the prices are— go down at the Google auctions. Yep. So now you're marketing harder with the same money. So now all of a sudden Bob, Fred, and Tom cut down and you're going to go full steam ahead or maybe put a little bit more, whatever.

15:05Now all of a sudden you're out there and you're going to start growing or sustaining or getting work in. And once again, think about it, it might take a month or so for everybody to start petering out, but these slow cycles usually last a couple months, right? So by the time you come out of the end, they still got to start their marketing back up, get everything going back if they do.

15:25Yep. Right. Because they don't have no money. They're freaking out because 3 months are slow. They had no money in the bank. Da da da da. So now all of a sudden they get a little bit of money. Well, we got money. We better get, get our marketing going again to get busy. Then they have to start out paying these keywords, huge amount for these keywords.

15:41When we never stopped, we put a little bit more skin in the game and we've made money, we've sustained or we've grown. And statistically it said people are growing when everybody's cutting down and you stay going, you actually grow. It's kind of like if you're, if you're— I don't know if it's a good analogy, but you're climbing a mountain. If you just stop, how much more energy does it take to keep moving.

16:02If you're steadily climbing, you're being consistent, you're on the free fall by the time somebody decides, oh my God, here I got some money, I'm going to start marketing, and they got to start moving and getting themselves out there. You're, you're already dominating, right? The analogy is this: we're all fucking dead tired at my shops. Yeah, all my guys and me. And what we say when we get home, we keep moving.

16:18The minute I sit on the couch and I get home, what do I want to do? I want to doze off. But if I go there and I get on my tractor, I go do this, I go do that, I don't— I just keep going. Yeah, right. That's what people don't understand. Put some skin in the game, guys. Do not count your Do not cancel your marketing, cancel something else.

16:34Cut your cell phone back, pay yourself less. You could always get the money back when you get busy again. So 3 to 6 months, what does that look like? Well, it depends on how you're going to get it there because you can't borrow yourself out of debt. Meaning if you have all these loans, you can't make the payments, you can't go get another loan to make these payments.

16:55You can't borrow yourself out of debt. There's interest. I mean, banks make money by loaning money. Yeah. Right. They have this whole big snowball thing. They have the million customers, each one paying a dollar on top of what they do. Think about them. You don't understand. Just use that analogy. Interest rates are up and all that stuff. So all these guys borrowing money to keep their business going because they weren't not being smart.

17:16And it all comes back to what? The numbers. And it's crazy when you start to think about where do all avenues end? At the net. Like, these guys all go on the front end. They look at the front end. Yes, you're doing a great job, you're doing a wonderful job doing your markup in your shop management program, but that has no bearing on the back end, meaning you don't know what it is.

17:42So what does it matter if you don't charge enough or you charge too much on the front end, but you don't even know what's going on in the back end?. So think about it. Think about like, okay, what if you're a business owner, which a lot of these business owners, small business owners, is what I learned. When they're doing really good, they start taking money from their company.

18:02They start not worrying about this. I don't fucking worry about the increase of that. I don't care about this. And all of a sudden it creeps up, right? Eating at it. Right? So all of a sudden, think about this. Everything went up to the point where you're losing 20%. You're at your net is minus 20, meaning you're down 20% at the end of the month, every month.

18:19Right. But on the front end, you think you're killing it at, say, at the end of the month, we'll just say your gross is 10. Yeah. Or yeah, your gross is 10. You're still going to be down 10. You're not making enough money to even pay your bills. So from what I understand with my companies and I watch it, it takes a while to kill a company.

18:40If the company was strong at one point and everything's going good, it takes a while to kill a company. I know a company right now that was the world's leading expert in a certain division. I'm not going to say their name. When the old owner was there, he was kicking ass. Like, they were making money hand over fucking fist. When they sold the company, I think it's probably about 15 years ago, they have new leadership since then.

19:03He's retired, sold it, passed away, all that. It's slowly— this company is slowly tapering down. They are killing this company by making stupid decisions. One after another. Yeah. Yeah. Okay. And that's what ends up happening with these guys that at one point the business owner was doing really good. He was making a lot of money and he starts dialing it back. He starts letting his people do it.

19:27He starts to not go to work. How many times have we heard people, oh, I don't really go to work or I don't do this. They don't watch it. They start not doing this and these are creeping up. Then all of a sudden they realize one day, oh my God, I have no money in my bank account. My savings accounts are empty.

19:39What's going on? Well, everything has gone up, which we all know everything's going up at record, record pace with inflation and everything. They're saying inflation didn't happen. Inflation happened in a big fucking way. Okay, so all these numbers are creeping up, but you're never— you're not keeping up. Yeah. Yeah. And you could tell by back in the day, every year, twice a year, I'd raise my labor rate a dollar or two and that would kind of curve a lot of the stuff.

20:04I would watch my margins on all my other stuff. I would grow a little bit and sustain. Them days of raising your labor rate a dollar or two are gone. Like, I think the year after COVID when we were trying to deal with all the inflation, I think I raised my labor rate almost $20 that year. Wow. Yeah, I could go back and look.

20:22I think I went from like $185, then we went to frickin' like $190-something, then we went to $202. Like, it ended up at $217. So, so, sustain. What we were doing because the prices kept going up and I had to keep going. And I struggled that year. Like, I'm not gonna lie, like, every time I turn around, I was raising my fucking prices.

20:42I'm like, man, this is crazy. But when you look, everything around you is considering continuing to climb. I was just having this, this conversation with my son last night. He has a truck and he was like, man, gas went from like $3.80 to $4 to $4.99 in 2 days, you know? And it was like, it went from like $20 would get me like over a quarter tank of gas to like just above the E-mark, you know, like just, and so you think about that from a business standpoint.

21:07If you have vehicles out there, just that little, if you're not paying attention to your numbers, how much is that dollar raise in gas in, in, uh, infecting your bottom line? Right. And it's kind of crazy. Like some industries don't seem to be affected by it. Like for right now. Okay. This is how people think. Some of them, and I've heard this several times from some RV salesmen I know, well, I really can't afford the travel cause travel's so expensive.

21:28So I'm gonna go buy an RV. Okay, let me just go ahead and put this in perspective. If you buy an RV, like a motorhome, it uses what? Diesel fuel and gas. Yeah, right. Would you agree with that? If you buy a travel trailer, you have to pull it with something, so that uses diesel or gas, right? I know several people that I've talked to, like, yeah, we're not taking any trips this week, this year, because it's tripled the fuel cost.

21:52And I know because me and Marilyn went up north to open our cabin, and I drove, uh, my truck up there, my diesel. And I think by the time we were done, it was $200 round trip in fuel because I pulled the trailer with my, you know, side-by-side on it. So if you're on a fixed income and all of a sudden you're like, okay, my budget this for each camping trip is $100 fuel, like, because a lot of people will schedule their campground, right?

22:15And if people are on a budget, which they kind of know, like, okay, we have X amount of dollars left over for the month, we're gonna go camping, we already read, we already did it. Because people have this illusion camping is cheap. Yeah, yeah, yeah. That's where you spend lots of money to go live like you're poor, like in a campground, right?

22:32You like take your camper there and it's always fucked up. Something happened, it breaks or whatever. It costs you money. Your truck breaks down, whatever. Yeah. Camping is not cheap anymore because you're making that payment year round on that travel trailer, that motorhome, whatever. Yep. Now you double the fuel cost. So you want to go from— at Thanksgiving, you want to go from Michigan to Florida like a lot of people do in their motorhome.

22:52You said it pretty much. What was there, a 60% fuel increase? Yeah, overnight. Overnight. So all of a sudden, you know, you're freaking— you're way up on fuel costs. You doubled, over-doubled. You know, your $400 trip now is costing you what, $800, $810, $820, depending on the math or what you're doing or what kind of fuel you're using. Yeah. Okay. For some families, that's a big freaking deal.

23:15So absolutely. Then you go back to, okay, why are our repair shops slow? Well, Nobody's really in December decided to go camping. And, or I mean, in, uh, you know, in May they start getting their campers out, getting ready. So they bring their trucks in or their whatever they're going to travel. And it's cut down on travel. They're saying people are not getting in their cars and driving just for to drive around because it's just so much expensive.

23:38Right. So what's that do? Mileage, less mileage on cars and, you know, and then their extra money they had to maybe do maintenance or repair their car. Guess what? They're paying it in fuel costs. So there's a lot of things going on to people being slow. So what do we do to help, help with that? Well, I would have to say, these are my opinions and they're worth exactly what you're paying for this podcast to watch this podcast on YouTube for free, is, you know, there's lots of things you can do.

24:06You have to keep the momentum going in your shop. How do I do that? One thing that worked very well for us early on is every repair order, we would staple a referral card to. And I'd say, here, you can get a gift card if you refer somebody, a $25 gift card to any— and I put all the icons on the back.

24:22I did that, you know, referrals. We would do bundling oil changes, tire rotations and stuff like that. Do inspections, you know, keep, keep in front of people, text reminder, text messages, maintenance type of stuff, you know, stay in front of people. Sometimes it works, sometimes it doesn't, just depending on it. One thing I've never said, and I've never heard anybody talk about this online, I did this years ago, I don't do it anymore, oil change for life.

24:49Oh shit. That sounds horrible. So what I would do is say, okay, back in the day, we'll say an oil change is $60, $50, let's make it easy. Yeah. For $300, I can get you oil changes for life in your car. Every time it needs an oil change at this particular mileage, you bring it in, we'll do the oil change for free.

25:08Prepay for the service. So they pay $300 and get an oil change for life. What is that doing? I'm investing in my customers to the point where they're going to come back. I've already locked them in the box. Yep. Right. Yep. Because they're going to say, oh shit, it's a free oil change. I paid the $300 upfront. That was a cash influx to your customer, to your book, your money, right?

25:26When you're slow. And now that customer is going to come back every oil change. Now you have an opportunity to maintain their car. Okay. Yeah. Yeah. Now don't sell, you know, the guy that's completely broke and can't pay for the oil change at first. Don't sell him a $300 or whatever you're going to do oil change for life. Cause he's never going to fix anything.

25:46He's going to come in and do oil changes. Right? So you have to look at the right kind of customer and say, guys that really want to maintain their car, I can save you money. This is what you have to do. I also did DOT for life. You pay me, I don't remember what it was, $200, which would have been 2 years back then, would have been 2 years DOT.

26:04It was $99 for a DOT or $100. So give me $200 and you have a DOT for life. Every year you bring your vehicle in when your DOT is due, I will do a DOT inspection for free. Wow. That worked really well. I still have people coming in. It's been 10 years for free. They're free DOT. You trained them. I trained them.

26:22But, you know, I got them coming back to me. Yeah. So I'm getting, you know, everybody's saying, how do I get these customers to come back? Do services like that. You know, you could do, say, uh, brake— you could do brakes for life. We'll replace your brake pads. And everybody goes, oh, you're giving shit away. No, guys, think about this. We're trying to get these customers to come back.

26:40So think about this: if the guy next door is going to do brake pads for $19.99 and you're like, I don't do shit, but you have brakes for life like Midas did, made a lot of money off it. They— yep, you get free brake pads, but your calipers are the reason your brake pads wore out, or You're not ripping anybody off, but there's different— your slides, your rotor, whatever.

27:00Yeah. Yep. You know, so we do— we did stuff like that over the years when we were building the company up, and that really worked well. The DOT worked really, really well. At one point, I think I had like 20-some of them on there. Wow. So every year I kind of knew February plates are due. I knew, you know, we were a little bit slow coming out of the end of the year.

27:16We would have all these invoices or all these DOTs come in and they were free, and I just pay the guys their time for doing it. What do I care? 'Cause we, everybody needs something with the DOT. And that's not us picking the vehicle apart just to sell somebody something. It's a federal law. Yep. Yep. Yep. So there's FMSCA. Them are the people that say, here's the laws, here's are the standards these vehicles have to be at.

27:39So I can look at the customer and go, this is where you need to be to get the DOT. Really, it's problem solving. You see that this has to happen every year anyways. You have a customer, and I love that you emphasize this, not just any customer. If you have a cheap customer in front of you, you're not throwing them out the DOT door.

27:55Guarantee for life deal, but you have a customer that you can see cares about their vehicle or cares about what their business, that kind of thing. Here, boom, we have this deal. We can save you money. Here's this. And then you get them in and you train them. Right. Absolutely. And now that was stuff I did to kind of keep the place afloat back in the day.

28:11You know, we were growing and we would run into slow periods. Um, you know, bundling and stuff like that. I am not a big guy to go, oh, I'll give you 20% off this or 20% off that because anybody with any brain knows you're gonna raise it up 20% and fucking lower it 20%. Okay, so that's kind of— I think that's a little bit shady.

28:29Uh, yeah. Do you think anybody really gives you 10% off? Like when Dunham's or anybody gives a 10% off, what do you think happens to that price on the front end? Oh yeah, it goes up 10%. Let's be completely honest, guys. It's like most people don't know that— most women definitely don't know when they go to the clearance rack, start peeling the tags off when it looks like it's a deal, you pull the tag off and it was actually freaking cheaper before they put it on clearance.

28:53It's crazy. It's crazy. How about the places like when they go out of business? Like remember when Kmart was going out of business and they did the whole like everything has to go and they'd go like 75% off, but they marked the price up like 200% and then took— it was more expensive when they were selling at 75% than when they were selling it for regular price.

29:11Yeah. And there's a company that just went fricking balls to the walls and just— they— that Kmart was great. Sears bought them, right? And the guy who bought Sears, that CEO they hired, that guy fucking killed everything he touched. Oh my God. Sears. Yeah. All of it. You know, but you know, not to get too far off the beaten path. So, you know, we get slow, we panic because we maybe have a couple of weeks, then all of a sudden we have to start thinking, oh my God, I have to start worrying about laying these guys off.

29:37Well, here's what the— here. Okay. So here's where I used to always have a really hard time with flat rate when we were slow, because it's kind of like you're kind of cutthroat. Like, so we're slow as a business owner. I'm feeling the pain, right? Yeah. I expect my Technicians to feel the pain too. That's where flat rate came from. You know, you're splitting the risk with the business owner.

29:58So if obviously you're having most of the good months through the year and you're flat rate, you're kicking ass. But what if the shop, like nowadays, you got parts problems, you have all kinds of different problems getting stuff done, and then comes the slow season. These guys aren't making any money. Then people are wondering why they're leaving the industry. Once I identified that in my shop, I kicked flat rate out the door.

30:17So these guys are sitting on there going, yeah, this fucking guy, you know, look at, he switched his shop from flat rate to hourly since he made this podcast. And I said, go back and listen to my podcast. It was very clear. I controlled flat rate inside my shop for a long time to make sure my guys all made money. When it got to the point where I couldn't, I moved them to hourly.

30:36So I'm taking all the risk. So right now we're slow. I don't have to worry about my guys quitting and leaving. They're still getting paid. So at that point, Here, here's where really it's important to have money in the bank. What happens when you're slow? There's no cars in the shop. You guys got guys you're paying. Guess what you do? You prepare to deliver.

30:57What does that mean? Prepare to deliver. You maintain your equipment. You frickin fix stuff that's broken, that's been broken. You make sure your scan tools are all up to date and working. Okay. Some of the updates are free. Whatever. If you need to, go through everything, clean the shop, organize the shop, take a good look at your inventory. A lot of times you can send it back to the auto parts store even if it's 6 months old and you can get a credit.

31:22Filters and stuff like that. Have your people go through everything, clean out your inventory, get rid of the numbers that haven't been moving, get a credit that offsets your auto parts bill, right? You maintain your equipment. You don't have to go crazy and spend all your money, But you can maintain your equipment. There's ways to fix stuff, grease stuff. Grease is free, right?

31:40Just, they spread it everywhere. Yeah. Yeah. But you know, my point is it doesn't cost you a million dollars to grease everything, maintain everything, lubricate everything, adjust stuff. You know what I mean? Go around, clean your shop up, prepare to deliver. That jack that's been leaking needs that fricking $8 part. Order the $8 part, take the time to fix it. 'Cause at that point it's gonna speed up a job.

31:58So you're preparing to deliver in the future. A lot of these guys don't do that. They want to sit on a fucking bucket and cry and everybody watch TikTok videos. If you're paying these guys by the hour, they can say, hey guys, let's get this place ready to go. So when we get busy again, we don't have to worry about that jack being messed up or da da da da da.

32:18Yep. But a lot of these guys won't do it. You know, and if the shop is flat rate, how do you think a guy's attitude is going to be when you've been dead slow for 2 months? He's only made enough money. His bills are all behind. Then you're like, yo, hey, I need you to start going through this. They're going to be like, fuck you, I'm not getting paid to do any of that.

32:34And rightfully so. Why would they? Sure. Yeah. You know, it's kind of crazy when you start to think about how this all works and being slow is stressful for everybody. Business owners, the technicians, the service advisors, everybody's thinking, am I the next one to get cut? You know what I mean? So, um, And the other thing is too, if everybody's slow in your town, you don't have to worry about losing your technicians.

33:01They're not going anywhere. They're not going anywhere because nobody has any work. Yeah. Yeah. You know, and it's kind of like, you know, years ago I was watching an interview. Um, I don't even remember who it was. I think it was with Jimmy Carter. He said that there's never going to be an abundance of gas ever again. It's always going to be rationed.

33:19He said, you're never going to go to a gas pump. And you're never just gonna be able to fill up your car and just drive. And he said that, and I was like, listen to this video. And then, you know, we're there talking back and forth, and then I started reading the comments, and he's like, well, if nobody can get gas because it's rationed, everybody's in the same fucking situation, right?

33:42Yeah, it kind of goes, if nobody has work, yep, where are your technicians gonna go? Maybe if they're flat rate, they might go to a guy that's hourly shop. But if he's slow, he's probably not hiring. Right. And a lot of times in our area, when one shop's slow, everybody's pretty much slow. Yeah. We're the pretty much the one shops that when everybody's slow, we're never slow.

34:04Um, because we just do different. We do lift gates and just a lot of different stuff that nobody will do in our area. But we get a little bit slow sometimes. I think, uh, yesterday Lincoln told me 9 cars came in. So I think we've gotten like 18 or 19 cars since Monday this week. So I think I could actually look and see how many jobs are on the board because I want— let me see here.

34:28Just, you know, that way I could tell, you know, right now we're a little bit light at the shop. We have 36 vehicles in. Okay. So that's usually we run between 32 and in the 40s. So we're at 36. So we're ramping back up because we were a little bit slow, like I said, in April and May. Yeah. May was okay, but we're still, we were still down, you know, over $30 grand prior year in April.

34:55And that was some jobs just didn't get finished. And then May, May ended up okay towards the end, but we were still down probably over $10 grand. Now, and would I used to say this in sales all the time, it was like, like the great salespeople don't have bad months per se. They're bad months for them. But like any other average person would kill to have that month, that the great salesperson's like, oh man, this, this month sucked.

35:20Is that— would that— would you say that like your slow month, another shop may be like, oh my God, I wish I had that month? Absolutely. And you know, um, ours is deliberate. We've spent a lot of years trying to figure all this out to keep everything, you know, good. And, uh, a lot of the guys— these guys don't use their metrics in their shop management program because they don't put anything in.

35:40They don't keep track of technician hours. They don't keep track of this. Sell-through is a big one. What is your sell-through rate? If you have 10 jobs you're presenting to a customer and 5 of them are getting sold, do you have a pricing problem? Do you have a sales problem? What's going on here? What's going on? What's broken in your process? If your guys are out there writing everything that the car needs and you're presenting it to the customer and you're not getting any of it, okay, what happened?

36:06What's going on? And, you know, human nature in my experience is you're slow, so you get a car in, what do they want to do? They just want to go balls deep on this thing, right? It's like you're fricking— You're squeezing the blood out of the turnip. Yeah. You're like, this guy comes in, you're selling 85 flushes and he came in for a fucking blinker, you know?

36:25And that's what I talked about on that one podcast. These shops don't know how to deliver the news. Of flushes and everything like this. Now, I'm a firm believer nowadays maintenance is key. Was it back in the day with your C6, your C4 transmissions, or your grandpa? Not really. You could fucking do a full send on them and never change the fluid, and it burns up, you buy another one for $900.

36:49And yeah, at $900, that was a lot of money back then. But these guys just said, hey, if we change the trans fluid, it just causes problems. So nobody got into that, right? Well, now I call them wallet flushes. These guys come in and they get like BG Services. They want to sell a guy that comes in brake fluid flush, power steering flush, coolant flush, every flush under the sun.

37:08So the guy comes in and the parking lot's empty and customers notice this shit. Hey, how's it going? Good. We're a little bit slow. Okay, thank you. We'll check it all out. The guy gets this estimate. He had a headlight out and he gets an estimate for fucking every flush under the sun and a blinker bulb. The blinker bulb might cost $40 installed because it was a little bit of a trial labor to get the change the light bulb, but there's $900 worth of flushes on it.

37:33You look like a crook. Yeah. Yep. Now, if the vehicle comes in, like I used a Yukon, like, uh, in one of my podcasts, it comes in where it's having a throttle body problem, you know. Um, so you go ahead and put, you know, a throttle body on it. You sell the guy an induction cleaning because everything's carboned up and stuff like that.

37:53In my opinion, you'd be like, hey, we're putting this part on, but we need to do this maintenance so this part has longevity. That you could sell, that's understandable to the customer. Yeah, but when he brings his vehicle in for a misfire, it's running bad, you sell him a throttle body, you tell him, hey, it needs an induction service, and this is why, for longevity of the part.

38:11By the way, here's a picture of your brake fluid. Oh my God, look at this picture, you're gonna die. Your power steering fluid, your coolant, you're this. The guy's like, What the fuck? You probably just ruined the idea of him even buying that induction cleaning because he's thinking you're doing a full send on him. Yeah, this was happening when we're slow as shop owners.

38:28I've never done it because I'm smarter than that, knowing like, okay, I got these customers' trust. I'm not going to do a full send on them and sell them shit they don't need to try to make our bank account. And another thing that I will tell you, one of the shops around us, we used to get a ton of work once a year from in the summer.

38:44His name was Jerry. He's dead now, so I can talk shit about him. He would go on vacation, these lavish vacations. He would come back and fucking raise his prices through the moon. Oh my God. Because he would go on vacation, spend money, yeah, and feel all broke, yeah, and come back and hammer his customers. And they all come to us, and it got to be a joke.

39:01Holy shit, next month's vacation month, we'll be busy. Because Jerry was right next door at the Marathon station, and they had two bays back there. And he would get back and he would just do a full send on our everybody. I mean, he would put on the fucking gloves for palpating cars and he would go up to his customers' asses like, oh my God.

39:17You know what I mean? Back then, tune-ups and stuff, like 3 times more than they were worth because tune-ups were a big thing in the '90s. We were putting spark plugs, wires, and all that. It was a full cent on everybody. And we used to get the work from him. Yeah. Oh my God. And I used to often think to myself, okay, you can't be broke because you did something stupid or whatever and take it out of your customers' asses.

39:37And he did. Well, and it goes back to what you were talking about a couple of weeks ago, where being an employee and being a broke, being broke, and it's your boss's fault. Like it's nobody else's fault. Like don't try to take it out on them. Yeah. And it's like, you gotta watch that stuff. So you're, if your business is slow, you should take the time to look and see, okay, let's look at all the numbers.

39:56I don't know. I don't really know how to look at numbers. Call somebody. I do fricking Repair Shop Rack. I do people's numbers all the time. Look over their numbers and stuff and figure out where they're at and tell them, Yeah, they don't even hire me for consulting. I basically say, here's your numbers. You want to know the number one phone call I get?

40:11Hey, I need a lot of help. I need help with my numbers. Okay, good. Can you go ahead and send me over all your information that you have? Get it together and I'll do a repair shop reckoning on it. I'll go through your numbers and I'll tell you what your— all your costs are and what you're keeping at the end. Do you know the number one thing that happens?

40:27I never get the numbers. You know why? They don't have them. They don't have them. They're fiction. Yeah. So they're like, I'm broke, I can't pay my bills, I don't know what's going on. I'm like, they call me, they find it important enough to pick up the phone and go, hey, I'm having a problem. Okay, send me your numbers, send me your bank statements, send me your taxes, send me something.

40:48They don't even have it. Some of these guys don't even file income tax. Wow. They just haven't been caught yet. Like, that's how bad it is out there with some of these shop owners. Shit. These guys don't even know what they're— they just kind of do by the Holly. I've had the number one thing, oh, what's your parts markup? Just depends how I feel about the job.

41:07What the fuck does that even mean? What does that mean? That your wife was mean to you, so you're ready to cry, so you're going to take it out of your customer's ass? Like, what do you mean? Like, okay, let's go back to— let's go ahead and break this down. That net number kind of drives everything forward, right? We have to start— okay, it goes both ways, right?

41:26You have the numbers set on the front end, right? We all know, okay, we have to get this gross, right? How do we determine what that gross needs to be? Where you want your net to be. Okay. If you wanna trade dollars, great. If you wanna make 0%, great. But you have to figure out all your costs and set your labor rate accordingly and your parts markups accordingly.

41:49That's what these people don't do. They just think, ah, I bought the alternator for $50, I sell it for $100, I'm making money. It's really, you said this earlier, it's like when taking the emotion out of it, it's like this is, you know, when we were talking about like holding the, you know, having the records and the documentation and everything and you're taking the emotion out of it, it's not an argument.

42:10This is what happened. It's black and white. It's the same thing. You don't want your business to be like, oh, I really like this customer. I'm gonna give them a deal. Oh, this customer, I've gonna, you know, raise my prices. You're, if you're making you're pricing on emotions. We talked about, uh, the last episode, like, when you are emotional, your intelligence goes down.

42:27And so when you hit slow times, all of a sudden now you're doing all this dumb shit. Yep. Instinctively, when I become slow and my numbers are down, I'm at the shop figuring out why. Is it a marketing problem? Is my keyword guy not doing his thing? Is my marketing guy not doing his thing? Yes, I fucking caught him. I fired him, remember?

42:46After all them years, I start dissecting to the point where it drives me absolutely insane. But a lot of guys don't do that. They want to sit there and have a pity party. Come on over to the counter, guys. Let's all cry. Let's be fucking Eeyore. Let's bury him. You know, well, it doesn't matter. We're going to go out of business anyway.

43:01That's all gloom and doom. Start figuring out why this is happening. Were you a dick to 90% of your customers and overcharge them? Or are you had the wrong customers? Like, is there a lot of things going on? Oh, well, I'm slow right now here. You know, in, you know, January, February. I don't know why. That's because you cut your fucking marketing to zero at the end of November because you were slow and had no money.

43:23Let me ask you a question. How are you doing now that you cut your marketing? You probably lost more opportunity. And that's what these people don't stop and think. It all comes down to what? Their numbers. You guys got to figure out your numbers. It's just like any business is the same way. And I was telling the guys yesterday, we were talking about a light from Volvo, which was like $200 for this fucking light.

43:46And I was like, holy shit, that's like highway robbery. And I said to Lincoln, we're all sitting around talking. I said to Lincoln, I said, what did the guy say to you when he told you the price of the light? He's like, what do you mean? I go, what did he say? How did he sound? He said he sounded like he's like, the light is $200.

44:05I go, well, did he say, did he stutter? Do you say, oh my God, the light's $200? Did he do anything? He said no. He just said it's $200 fucking dollars. And Lincoln said, well, what's my cost on it? Da da da da da. He told him, he said that guy had zero emotion. I go, so what did that tell you? He had no control of the pricing.

44:24Somewhere up above him in the ivory tower said, this is what we have to make on this light to pay all the guys here at the Volvo dealer and be profitable. Do you think that that guy ever stopped and thought for a minute that light was $200? Like, holy shit. He might have in his head, but he thought, I can't fucking do anything about it.

44:40Yep. Or you get these guys to go to sell you something and go, yeah, that light's $200. Yeah, you know what, I'm going to take 20% off. That's fucking crazy. It's all in your voice and your body language. Yeah. You look at— we look at our customers and go, here's the price. Goddamn, that's— yes, that is really expensive. That, you know, we build value into it.

44:59And a lot of these guys don't do that. The minute the customer says— and I've seen this with some of the clients that I've had. The minute the customer starts whining about the price, they start backpedaling, stuttering, don't know what to say, and give them a discount. 5,000% discount yourself out of business. Yep. Now, did I ever do it when I was young?

45:18Absolutely fucking literally. When I was broke? Oh, okay. Absolutely. Before I knew any better? Absolutely. But what does it get you when you keep discounting stuff? You look at your freaking numbers at the end of the month, you're like, $10,000 worth of discounts. Holy fuck. $5,000, $4,000, whatever it is. You discount yourself out of business. Why? Because you're not sure of what you're doing.

45:39If you know that you say you pay a dollar for this fricking cup and you know your costs on top of you have to make 25 cents on it, right? You're not going to go, here, Jason, here's this cup for $1.25. And Jason goes, that's expensive. I'll sell it to you for 75 cents. A guy who didn't know his numbers will do that.

46:00Yeah, right. Do you realize— think about this, guys— 20 cents of every dollar is profit at your company if you're doing— depending on where your strategy is, you're trying to do 20% net. So out of that dollar, you get to keep 20 cents. Think about that. That's— it makes it seem small at that point. It makes this thing small, but when you start thinking about 100 Yeah, then it's a $20 bill, $1,000, $200.

46:27It goes up. Yep. So you start thinking about this stuff, guys. You could discount yourself right into the frickin negative pretty quick, especially if you're not pricing on the front end. What if you're frickin— you did it because you— how you felt and you mark something up 20% as a service advisor because you don't really know where you're supposed to do it because your boss has never given you a labor matrix or your program's not set up because you never took the time to set it up.

46:53And the customer starts bitching and you look around and Bob, the owner's not there. And you're like, uh, I'll give you a 20% discount. You just lost money doing business. Then on top of it, guys, take this into consideration. They bust out their credit card, then they pay, and then you take a 3% more hit. So now you maybe you got a 20% markup.

47:15You gave a 20% discount, right? Then on top of that, here comes a credit card. Yep. So you just literally lost money doing business. That's why it's so important to know where your numbers need to be. And I love this. This comes back to Prepare to Deliver because if you're slow, what in, in, to your point, diving in, where are the gaps?

47:34Where are we losing the money? What are your people saying when it comes to pricing? What kind of faces are they making? What's the tone of their voice? Can you see it? I, I, when I was like, from a sales leader standpoint, I'd work with all my salespeople and I'd see that. That, oh, it's, you know, like, uh, like when you make that, you're done.

47:50You're done as a salesperson. You're now backpedaling. You're on defense. And that, and, and most people do it subconsciously. Customers will start attacking you because they see that weakness. They'll start bargaining, bargaining with you. And so when you prepare to deliver, what do you do? You practice with your guys. That was the next thing I'm gonna get into. When you're slow, what do you do?

48:09Train your people. Yep. Start doing, if you start having fun, You're slow. It's a high-stress situation. Everybody's freaking slow. You're out, your people are all there. Start doing freaking training skits. Call them on the phone, call each other, have their service advisors do all the training I talk about. Prepare to deliver. It's not just fixing your equipment, it's fixing your numbers, it's fixing your employees.

48:29Where do we have a problem? Where's our warranty? Let's look at our warranty. Maybe we need to change it because things have caught— like, I caught one here, um, and our warranty didn't talk about caulk. Well, Caulk is a motherfucker to do on these travel trailers and stuff like that. Sometimes they'll get an air bubble and pop and it'll cause a leak.

48:43So we give a warranty, but we don't give a lifetime warranty. We don't say it's 3 years, 36,000 miles on all repairs except for caulking, because I cannot— you know, it'll get a little crack and then ice water will get in, it'll freeze, it'll open the crack up, all of a sudden runs down the wall. That's on me. I can't control that type of stuff.

49:01That's all stuff we figured out. We were slow. You know, we started looking at problems we were having. You know, we look at our— we put everything in category. So one thing we are slow— in December, I think we started looking through the categories and I started looking at the warranty category. I'm like, let's look at the warranties and see where we're at warranties.

49:17And that's what we came up with. Travel trailers are a real problem. Motorhomes are a real problem with caulking. So we came up with like, look at all these, like, okay, we need to change this up because this really technically isn't our fault. We're doing the best we can, but there's a chemical breakdown. There's, there's things that happen with air bubbles and stuff like that.

49:32That's just not on us. That's all stuff that you're not going to stop and deal with when you're busy. Because when you're busy, you're the best. I said this before, you're the best business owner in the world. You got everything dialed in. I'm going to the lake house Friday. I don't give a shit about warranties. I don't give a shit. I'm making money.

49:47Here we go, boys. Everybody's happy. We don't pay attention that, hey, this jack is broken. Fucking push that bitch in the corner. We'll deal with it later. And that deal with it later never comes. Yep. All right. Then you get slow, you look and everything's broken and everything like that. So there has to be a balance in taking care of your equipment, guys.

50:03So don't— I'm not saying wait till you're slow to start fixing all your shit, but prepare to deliver. Nobody wants to be slow. But the fact of the matter is, you look at like high-end athletes, athletes have off-seasons to prepare to get better, to get stronger, to work on their game. And I think business is the same way. When we have downtime, that's our off-season to prepare to deliver.

50:23Yeah. And you don't sit there and switch everything up when you're super busy because everything you think in your mind psychologically, everything's working. So you're not sitting there scrutinizing everything. How many of you guys that are business owners, shop owners, go out there when you get slow, you start looking, are my prices too high? What are my service advisors saying? What's going on?

50:43Blah, blah, whatever. My marketing, is it working? All that. But how many of you people actually take a deep dive into it? How many times, how many do you guys ever pull up the phone calls and sit there and listen to them with your guys? Just listen to them to see what they have to say. What's going on? Are they driving customers away?

51:02Are they not using the word tracks that you taught them to use to bring them in? Well, fuck, most of these guys don't even train their guys. They hire a service advisor who has no sense, nothing, because they're out back in the shop working because they don't have no money and the owner's in there working. Okay, there's a guy on one of our posts.

51:17Did you see that guy said, I'm 100% wrong. If you're a business owner and you're not out in the shop working on it, you're going to go out of business. You're stupid. He said I was stupid for saying that if you're a business owner, you should be out there fixing cars. Wow. Yeah. Wow. Yeah. I mean, to your point, and you said this so many times, if you're, if you're a business owner and you're fixing cars, you're going to fix more cars.

51:39Absolutely. Your cars are going to be fixed. I mean, you're the best guy usually in your shop to fix cars, right? That's why you started the shop. But a lot of these guys, sometimes you think ego plays into a lot of the— with these guys. They don't really want to talk about their numbers. Every one of the clients that we get come to the realization that they're not making money.

51:55They're working themselves to death and they're pretty humble. Yeah. Would you agree with that? Like, every one of our clients is like, man, I took me all this time. Tim says it took me 7 years to create this shit show with my numbers, but he was always fixing stuff, doing stuff the right way. He just didn't have no processes in place. Now that we're getting to the wire, he's going to know everything about it.

52:15We got all the other guys, you know, These guys are all doing better because now they know where the front end marketing needs to be. We're guessing right now and still on a couple of 'em because we still haven't got the QuickBooks figured out yet. We're still dealing with a couple of it on a couple of 'em, but we got this industry standard there where they should be.

52:33Well, and, and I'd say if, if it, and it comes down to ego is a really good way to phrase it, cuz from a business owner standpoint, no matter how good you are or how bad you are, you have to come to the realization that you could get better or there's something that you are doing that's holding you back. Right. And,— and I know you've explained your story— you had to go through coaching.

52:54You went through Management Success. You had to admit you didn't know what you didn't know. And like, you know, the TJs and the clients that have come to you and have put their guard down and have put their ego away and said, "I have a problem. I've broke this stuff," they're going to get results. They're going to grow. They're going to continue to be successful.

53:11They're going to— or they're going to become successful versus the people that They say they're broke, they won't give you their numbers, and they're going to call you in 6 months and they're going to be just as broke, broker, or out of business. Yeah. And you got to watch who you get your advice from online, guys, because everybody's got an opinion. Yeah.

53:26Okay. Can I learn something? I learn stuff every day. Okay. It's not like I know everything about everything about everything about this business. I learn stuff every day. I went through my insurance and my insurance paperwork with my guy line by line. Do you know how much money they charge me? For terrorism insurance. Terrorism insurance everywhere around. They sprinkled this little terrorism clause in there.

53:48$23 here, $19 here, $2 here, everywhere. Terrorism clause. That is insane, right? And the other one they did was cybersecurity clause. You know, that was like $480. I'm like, we're all on the cloud. All of our shop management's on the cloud now. So if they take over the shop management program on the cloud, fucking insurance ain't going to help me here because you start reading into it.

54:13I had to pull it out. It's stuff on site. Well, we have all cloud-based shit, so if they take my computer over, I'll throw the motherfucker in the garbage and go get another one and just sign into the cloud and deal with QuickBooks, you know what I'm saying? So that was like, so I think I pulled $900 out right away before we made any changes by just canceling them things by going through my insurance.

54:35It was my yearly thing. I went through all the companies. And I saved $900 right off the rip. And I know I'm waiting for a couple other things. I think the one thing I found was $1,800. Wow. So right there, $3,000 saved. That's going to come right off, you know, my, my, you know, my middle section of my P&L sheet we talk about.

54:53And a lot of these guys won't sit down there and do that stuff, or they're afraid to call the insurance agent, or the insurance agent starts to get butthurt with them and starts giving them a hard time and pushing back. And you know what I mean? There's Let's face it, these insurance agents work off a commission schedule. So every time you take something off, it takes out of their paycheck.

55:09So if they don't know their numbers, they're broke. So there's a lot of different shit that goes on that, you know, comes down to— all comes back to what? Knowing your numbers. Isn't that crazy? It also comes back to everybody else is charging you. Everybody else is billing you. Yeah. You said this last week, like you get bills from everybody else. They don't care about charging you.

55:29Why are you so worried about charging your customers? Right? Yeah. You got to write your bills. You got to write your bills fair. You got to have it frickin priced right. So you're kind of within the industry standard. Obviously, you can't be 3 times more than everybody else because, you know, you got 6 Cadillacs and a fucking 4 houses and stuff. So you're like, yeah, well, you know, you got to, you got to pay the price.

55:47Well, and I'll say this to take a good look at what you guys are saying when you're crying to yourself and you're saying, I'm not making any money and stuff like that. Are you killing your company? Meaning, are you pulling every fucking dollar of profit out of your company for yourself as a business owner? Now, keep in mind, it's your money and it's your business.

56:02You could pull all the money you want out of it. Would you agree with that? Absolutely. But if you keep pulling the money out to the point where you don't know your numbers and you pull your company into a deficit— and I know I was talking to somebody the other day and they're like, you know, we can't afford a tire machine over here or fix the balancer.

56:18But the fucking owner just went up north with his two new snowmobiles he just picked up with his brand new truck. And I'm like, oh, they're like, yeah, it's a company truck. So this fucking guy is over here buying everything under the sun, pulling everything out of the business. That's crazy. You know what I mean? Then the business can't maintain its stuff.

56:39So then the cost, the employees don't think for a minute your employees don't look at what you're doing. So you better treat them good and have the money to fix shit and upgrade stuff when it needs to be done. So they don't look at, you can't look at your guys and going, hey, I understand that you're perhaps on flat rate and I want you to do more hours.

56:55But yeah, I understand that you have to fuck with the tire balancer for an extra 20 minutes to get it working. That pisses your employees off. You want me to produce, you want me to do all this, and you can't even afford to fix a tire balancer because you just bought two snowmobiles and da da da da. There was an engine rebuilder called Chuck, Chuck from Chuck's Engine Exchange.

57:13They're right across the street from us. For years, they were the premier engine builder. That guy laid off a bunch of people, cut his costs and stuff like that, tell everybody we don't have any money, blah, blah, blah. And here comes about a week after he lays these people off and cuts everybody's wages and cuts their hours and stuff like that, cancels their health insurance for their families that he was paying for, shrinks everything down.

57:36Here comes a truck delivering bags of sugar beets for his place up north to feed the deer. Then a couple days later, I'll never forget this, here comes a dealer delivering his two brand new snowmobiles. Wow. Okay, so he's in here saying, guys, I can't afford to do this, help you do this. We need to scale the business down and pull all this stuff out of your hide, right?

57:56Back her in right here. The Sugar Beats and the Snowmobiles. Now, you're not responsible for your employees' financial decisions. If they're broke because they're doing stupid shit or they have 5 baby mamas or something, that's on them, right? But you do have good employees that do everything they could for the benefit of the company. They show up at work, they work every day.

58:15And you as a manager or an owner of a business are going, hey, we're broke, we can't afford this. You kind of got to watch what you do because you kind of put yourself underneath the microscope. And I'm not saying you as a business owner can't have nice things. I'm not saying that at all. But what I'm saying is if you pull your cost, your, your business into a vacuum and then you're telling everybody, hey, Jason, I need you to take a pay cut.

58:37Hey, you need to sacrifice. You need to sacrifice. And you go ahead and pull these snowmobiles in here and the sugar beets. That's not a good look. Is it rightfully your money? You could do whatever the fuck you want, yes. But if you have a morale problem, that might be on you if stuff like this is happening. And you're also kind of like burning the bridge to be able to have more Snowmobiles and Sugar Beats because you're pulling out of your business, you're, you're kind of bankrupting that, you're burning all the bridges with your employees.

59:04They're not going to work harder. You're not setting them up for success because again, it's not yours, their responsibility, your responsibility of whether they're managing their money and that kind of thing. But it is your responsibility. And I love you said this last week, as an owner, you take a responsibility seriously to put them in position to succeed. If they're not in position to be able to make money because you didn't market and there's no customers and there's, and all your tools are broken, like they have no way to succeed.

59:28Now it's your fault. No. And I would agree with that. And you know, the funny thing is with a lot of these, um, I don't, can't tell you when the last time, and I'm not even lying or bullshitting or anything, one of my employees came to me and said, can I get a raise? A lot of times I preemptively do it. Like usually June, July, I kind of look at everybody's wages and fricking give them everybody more money.

59:50I just did it actually a few weeks ago, gave everybody a fricking couple of the guys raises. I'm like, yeah, you need a raise. Like he's been here and I just gave him a dollar or two or whatever it was, you know what I mean? Per hour. And that speaks volumes. They don't have to ask. It's huge. So we were a little bit slow.

1:00:06Did I give a raise? Yes. Like I know my numbers good enough to know that. If I give a guy that works 40 hours a week, $1 an hour, it might cost me $1.25 an hour by the time I put everything into it with the guy. But what do I get out of that? The guy keeps a good attitude. Yep. Right. And I just got done moving, so I bought a different house.

1:00:26Like, there's a lot of things that went on in my life. If I didn't take care of my guys, they could look at me and go, this fucking asshole. Yep. Look at his house. Look at this. Look at that. Like, he's just got back from vacation. Look at that.. But none of my guys do because they all know that I take care of them.

1:00:40I wish I could pay them all $250,000 a year. That's just not in the cards, right? Yeah. But they all make a really good living. And, you know, a guy asked me, you know, do you ever worry about your employees leaving? I said, no, not at all, because I pay them above scale. Like, I've had guys come and want to say, hey, hey, so-and-so called me, you want to hire me?

1:00:57I go, yeah. You're like, what? He's like, yeah, I would lose $10 an hour working for you. Like, There's business owners too that I see on Facebook that literally say, hey, I'm a construction company, I'm looking to grow my team, I'm willing to pay you $20 an hour. $20 an hour was a great wage 10 years ago. Yeah, 20 years ago, right?

1:01:20Yeah. Right now you can go to McDonald's, Taco Bell and all that and make $18, $19, $20 an hour. Yeah. And you don't have to work on a construction site fucking carrying wood and working your dick off. Yep. So, and you got Instacart, you got all these other little bullshit DoorDash. These guys are making well more than $20 an hour. So being a business owner, not knowing what the market is really paying these guys is a whole other thing.

1:01:48Then you hire this guy for $20 an hour. He doesn't show up for work. He's got a drug problem. All of a sudden your tools are missing. This poor subpar work. There's a lot of things that go on. My point is, is like, these guys think that $20 is a lot of money. They don't— they're never even stuck up, kept up with the times.

1:02:05Yeah. So you get these older business owners that don't know their numbers. They've always done it this way. $20 an hour was a good wage 10 years ago. And they do think about— if you really think about that, like they did a statistical check, they asked these old guys how much bread was a loaf. A lot of these guys said $0.25 a fucking loaf still.

1:02:24Right. Because they don't really never kept up with the times. Their wife has always gone grocery shopping. They never even took into consideration what the cost is, what the cost is. And think about that. If you're a business guy that has always done it the same way at your shop and you've seen these shops, guys, that you walk in, you're like, holy fucking shit, 1960.

1:02:40They call, they want your lobby back. They got the paneling, they got the green carpet. You know, the guy's still there and the guy sitting behind the desk and he's got 1 or 2 employees that are fucking pissed off to no end. But they just haven't decided to leave yet. The old man, I've always done it this way. It's always worked this way.

1:02:55Yes, it did. But times have changed. You— things you could say on TV, you can't even say anywhere now. Go watch an episode of Sanford and Son. Watch some of the words they use. Or Archie Bunker. Oh, yeah. Okay. The shit in the '70s and '80s that was said. Yeah. Oh, my God. They'd be canceled. You'd be canceled nowadays, right? So you don't think that TV's changed that much?

1:03:17You don't think business has changed that much? I mean, this is really a good analogy to really break it down because business has changed that much. People think that, you know, I'm not really a guy— and I said this before— I don't really give a shit about reviews because you know what? You cannot make everybody happy. There's some people that are going to come into your business no matter what you do, they're going to leave you a shitty review.

1:03:37Yeah, they've actually got to the point now where they come in there and they meant they're already planning on fucking ripping you off on the repair because once they get it all done and get out, then they go and dispute it on the credit card. Then you have to fight for your money. There's people that are going out there and doing that.

1:03:52Do you think somebody would have done that in 1970? No. Maybe the statistics were this big, right? But not nowadays. People are always looking to rip you off nowadays. And I want to make sure you guys, you know, know your numbers. But some of you guys, communication is key. Getting signatures is key. Writing estimates is key. Get with it. Go on ChatGPT and ask about your, your state's repair laws.

1:04:15Some of these repair laws in some of these states are crazy. Yeah. And think about it, you're a shop that's not making any money, and here comes Bob that you just did an engine for $6,000, he charges you back. That could put you out of business. So when you really start talking about all this huge big pile of stuff, it all comes down to knowing your numbers and keep your marketing going when you're slow, fix your stuff and get right prepared to deliver.

1:04:41You know, Lincoln always says that now. I love it. He goes home and he says— he told me the other night, he's like, I think, um, Mondays I'm not taking any clients. I said, why is that? He said, because I'm going to prepare to deliver, Dad. He said, I'm going to get my trailer all washed, I'm going to make sure all my chemicals are full, I'm not out anything, everything's in working order.

1:05:00So when I show up on the job Tuesday, boom. I said, well, aren't you gonna lose money that, that Monday not being open. He said, Dad, what happens if I'm outta chemicals? My power washer's leaking and broken. I get to the job, I have to go to Home Depot 3 times. That job takes me 4 times longer. I cancel the other 2 jobs.

1:05:18So I already lost that money. He's like, it makes no sense. He said, not to mention, do I wanna pull up looking like being the most expensive guy around, being professional, my trailer's dirty, everything's broken. He's like, I clean my truck, I organize everything. When I pull up to the job Tuesday, I'm good to go. I'm like, that makes complete sense. But he has listened to me over and over.

1:05:37Prepare to deliver. When you're slow, prepare to deliver. That's where I'm at. When you're slow, prepare to deliver. What does that mean? Training your guys when you're slow, checking your numbers, looking at your overhead. Can I shrink it 10%, 8%, 6%, wherever, right? But guess what has to happen before you start shrinking that, boys? You got to know where your numbers are actually.

1:05:57Train your people. I want to say that enough. Train, train, train. I can't— 5, 10— train your people. Okay, start looking. Why did we lose that job last month? What happened? Start quizzing your people. Hey, you know that job in there? Go through your customer list. What happened last month? Let's go customer slow. We're not doing anything. Let's go customer. What happened with this one?

1:06:15Well, they didn't want to buy it because of this. Well, you could have probably did this. Well, what happened with that brake job? That was front brakes and rear brakes. And it says right here that the front brakes, you know, were at 10%, but the rears were at 20%. He didn't buy anything. Well, did you tell them, hey, we can go ahead and do the front brakes because they're the ones that are going to cost you money if you don't get them done right away?

1:06:34We could wait a few weeks or a month or two on the rear brakes and we schedule you back. Did you do that? Oh shit, I didn't even think of that. He just said no, he can't do it. Did you say, oh, I can't do the front brakes? Well, wait a second, we could put a little bit cheaper brake pad on there, uh, for you, but you understand it's a little bit less of a warranty, but we can save you money on the brake pads.

1:06:53Well, Okay, well, do you not realize if you buy a set of brake pads for $20 and you can sell them for $40, you're going to make more money than buying the Wagners and marking them up? And I'm not saying guys sell cheap parts. What I'm saying is when you're slow, you can save jobs that way. You know, we don't do stuff like that anymore because we're busy pretty much all the time.

1:07:11We're not— I like to stick with— I don't really want to get into the situation where I put cheap brake pads on, it causes me a headache of squealing all the time, stuff like that. But I'm just kind of giving people ideas of what they could do. You know, so prepare to deliver when you're slow, guys, and do not cut your marketing.

1:07:27Cut something else. I'm going to throw this out there because this really aligns. If you're sitting there and you're listening to the training and like, that's great, but you don't know where to start, or you haven't given your team a script or what to say, you haven't trained them, you want to listen on the phone calls, but you don't know the difference between good and bad.

1:07:46We, you know, we are, we've been working on, we've talked about it in a couple episodes, the front counter control. Yeah. The online training. We've put a lot of work into it, broke down the way you communicate and the way you have your shops communicate into a whole entire framework. We have evaluation sheets. Super excited to get this out there because it is something that can help these guys that are sitting there like, where do I start?

1:08:08They can jump onto this training and go through and have evaluation sheets, have an understanding of how to train their people and get the good results. Yeah. That's gonna be hopefully coming out in the next couple weeks. We keep saying it's gonna come out. It's just a lot of work and we're just, Want to make sure it's right. It's good and it's value for the dollar.

1:08:24Once again, I don't want to put shit out, neither do you. Yep. You know, and I'm going to end this with a couple words. I've already ended it 3 times, but I'm going to end it. I had 2 things I want to say. My word track the other day on a client that was all pissed off that they brought their truck in, they had it towed in, it was a no-start.

1:08:42We're like, listen, it's an hour to put the driveshaft back in it, try to get started. If you can't get started, we're going to use the rest of the time to pull the vehicle in. So it's gonna— we call it incapacitated vehicle charge. And they're like, that's $185, or it was— we charge $185 for that. That's $217 for that hour to check it out.

1:09:02Hey, listen, if we can't get it in, we're gonna have to have 2 guys go out there and use the rest of the time to get in. I'm in the wrong business. Actually, ma'am, you're in the right business. You just don't know how to run your business. From the looks of your truck, you've taken all the money out of this truck. You've The roof is ripped off.

1:09:16You have duct tape on it. It has not had a DOT in 3 years. The tires are bald. The truck is leaking oil all over the place. Now it won't start. Okay. The truck is a piece of shit. Okay. You've pulled every nickel out of your truck and now you're mad at me that it's going to take 2 guys to get it in the shop and we can't get it to crank out in the shop.

1:09:37You know, we thought it might have had an electrical problem and she's mad at us. That's not our customer. So she ended up saying, I'm not having you do anything. I'm towing the truck out of there. Fine with me. Cause if you're already giving me a hard time about an hour diag, or if we spend that hour on diag, we have to get it in the shop with you guys getting it in.

1:09:56You don't already have the money. And I'm not being arrogant, but you have to know your customer base. And this brings out another good point. I'm going to shut my fucking mouth, but when we're slow, we take in jobs we normally wouldn't take in. Yep. And then we get busy and we have that job gets pushed off to the side. You know, we take this job and then we really necessarily wouldn't have taken in because the guy doesn't have any money, but we're going to try to make some money and we're going to try to do this.

1:10:20I don't do it anymore. And then all of a sudden the job is there and it's in your bay and here comes the other work that you can make money on. And here's Billy Bob's, you know, clusterfuck of a truck that's been wired and messed up and it's just he doesn't have the money and now the truck's stuck in your bay. So you kind of got a little bit kind of look at your customers' vehicles when you're slow, guys, and say, well, I'm just going to take this in because it's for something for the guy to do.

1:10:41When you're going to lose money, you'd be better off just sitting on a bucket and not spending your money to fix somebody's truck. You'd be better off preparing to deliver. Yeah, you're better off getting ready to deliver, not having these all your shop full of shit that you took in because you were slow. So, all right, have a great day, everybody.